Stupid? Nope. ALL of my friends are wowed by this the most.
It really showswhat this little sucker can do with its cpu/gpu.

eg. My friend was testing out my phone.

He started up SiB and started a normal xvid video file. (Music video)
Then press F to show top bar, then task switcher.
Thumbnail of the video still clearly shows that video is playing.
(Also, we can hear the music from the music video..)
While this, my friend launched Megagear Sega emulator.
Then he started playing a game. It was playable! Amazing.
(btw, the music video was still playing in the background)
Then he quit the emulator, task switcher still showing video thumbnail moving.
Then click on the video again. Voila, back to the video. Awesome.
(there were no hiccups. Video was still playing smooth.)

I'm not sure what other phone can do this. Impressive.

Oh, and I do not see any Overlay issue other than in Conky app.
Web browsing and various other apps all work fine while video is playing in background.

Other phones can't even imagine this

I like to start the secondary LXDE desktop in Easy Debian and then start Gimp (a photoshop clone) in there. I use the Maemo photo app to find the name of the photo I want to edit and then I switch back to Gimp to open the photo. I then do a white balance or whatever and save the photo with a new name. I can then go back to the photo app and flick back and forth between the before and after pics. When I like the results, I tag it and upload the picture to Flickr with sharing. (Example before and after pics)

I've noticed when doing some intensive tasks (editing a mask on a 10 megapixel picture from my DSLR or whatever) the N900 really becomes useless for other tasks... But I don't know any other handheld device that can run a photoshop-class application.

If people can get by without true multitasking, more power to them. To even discuss the point is kinda silly in this day and age.

When you're used to true multitasking (not just state-saving), anything less feels like a toy.

When all iPhone users asked me why I've not bought an iPhone instead of my N900 (or even when I was using N95), my first answer was always "I'm not going to downgrade my phone"

To further elaborate, I use my phones a lot doing snapshots and video recording and use MMS to upload pictures to facebook directly. Not unitl 3GS video recording is supported and it still has a sub-standard 3.2M camera.

Not the only one on here. I'm a big fan as well.

I'm listening to Tunewiki with lyrics, having just received and read a push email, Nim IM online and Sportstracker GPS running in the background, I have just taken a picture and attached it in an mms, whilst browsing and posting to this.thread. And all this on my Nokia 5800. I could start up a video but it would pause if I looked at one of the other open applications.

I'm not knocking the N900, I love.mine, but I've been multi-tasking for ages.

Seriously, all smartphones have been doing multi-tasking for ages, except the obvious...iPhone.
(and I hate that most Window Mobile apps do not have an exit function, you have to use task manager or some OEM provide their own UI to kill the running apps)

I remember my first experience with multitasking on a smartphone. It was with my N73: many iPhone users asked me how I had managed to send an mp3 with bluetooth while listening to that mp3 with the media player and browsing files with my file manager (I miss X-Plore ).

BTW, that fact had been my first personal reason for not buying an iPhone.

Well, iPhone can do multitasking. As in, it can play a music in the background. To majority of iPhone users, that's all they need. =P
(Well, it can't even do that with all apps)